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224.60-120 Financial responsibility of petroleum storage tank owner or
operator -- Administrative regulations.
(1)
(2)
(3)
(4)
Each petroleum storage tank owner or operator shall establish and maintain
evidence of financial responsibility, as provided for in this section, for taking
corrective action and for compensating third parties for bodily injury and
property damage.
(a) For petroleum storage tank owners or operators of eleven (11) or more
tanks, the level of financial responsibility to be established and maintained
shall be twelve thousand five hundred dollars ($12,500) per occurrence
for taking corrective action and twelve thousand five hundred dollars
($12,500) per occurrence for compensating third parties for bodily injury
and property damage.
(b) For petroleum storage tank owners or operators of six (6) to ten (10)
tanks who have not been issued a closure letter from the cabinet, the
level of financial responsibility to be established and maintained shall be
two thousand five hundred dollars ($2,500) per occurrence for taking
corrective action and two thousand five hundred dollars ($2,500) per
occurrence for compensating third parties for bodily injury and property
damage.
(c) For petroleum storage tank owners or operators of five (5) or less tanks
who have not been issued a closure letter from the cabinet, the level of
financial responsibility to be established and maintained shall be five
hundred dollars ($500) per occurrence for taking corrective action and for
compensating third parties for bodily injury and property damage.
Evidence of financial responsibility may be established by any combination of
the following:
(a) Commercial or private insurance, including risk retention groups;
(b) Qualification as a self-insurer;
(c) A guarantee, surety bond, or letter of credit; or
(d) Any other reasonable and economically practicable means in a form
acceptable to the division.
To qualify as a self-insurer, the petroleum storage tank owner or operator shall
demonstrate a net worth in excess of the amounts specified in subsection (1) of
this section. "Net worth" shall mean the monetary value of assets that remain
after deducting liabilities. "Assets" shall mean all existing and all probable
future economic benefits obtained or controlled by a particular entity as a result
of past transactions.
The total liability of any guarantor under KRS 224.60-105 to 224.60-160 is
limited to the aggregate amount which the guarantor has provided as evidence
of financial responsibility to the petroleum storage tank owner or operator
pursuant to this section. This subsection does not limit any other state or
federal statutory, contractual, or common law liability of a guarantor to a
petroleum storage tank owner or operator, including, but not limited to, the
liability of the guarantor for bad faith either in negotiating or in failing to
negotiate the settlement of any claim. "Guarantor" shall mean any person,
other than the petroleum storage tank owner or operator, who provides
(5)
(6)
evidence of financial responsibility for a petroleum storage tank owner or
operator pursuant to this section.
It is the intent of the General Assembly that the fund established pursuant to
KRS 224.60-140, combined with the financial responsibility required by this
section, may be used by petroleum storage tank owners or operators to
demonstrate their compliance with any financial responsibility requirements
promulgated under federal regulations.
The Department for Environmental Protection, Division of Waste Management,
shall promulgate administrative regulations to implement this section. In
promulgating administrative regulations, the division shall not restrain or limit
the use of any of the means of establishing financial responsibility specified in
this section. The administrative regulations may allow a twenty-five percent
(25%) reduction in the level of financial responsibility set in subsection (1) of
this section for the timely completion of corrective action.
Effective:June 20, 2005
History: Amended 2005 Ky. Acts ch. 123, sec. 25, effective June 20, 2005. -Amended 1998 Ky. Acts ch. 284, sec. 4, effective July 15, 1998; and ch 498,
sec. 3, effective July 15, 1998. -- Amended 1994 Ky. Acts ch. 421, sec. 4,
effective July 15, 1994. Amended 1992 Ky. Acts ch. 450, sec. 2, effective April
13, 1992. -- Created 1990 Ky. Acts ch. 370, sec. 4, effective April 9, 1990.
Formerly codified as KRS 224.817.
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